BMO Global Asset Management has launched a new fund in its True Styles series, which aims to generate an annual gross return of 4.5 per cent in excess of cash.
The BMO Global Equity Market Neutral, which uses “academically proven investment styles”, will have a target volatility level of 6 per cent.
The fund will combine five style-based strategies; value, momentum, low volatility, size and GARP (growth at a reasonable price).
The fund is a SICAV with a sister OEIC fund, F&C Global Equity Market Neutral, launched in July. That fund has a higher volatility target and has attracted more than £200m since its launch.
Both funds target positive absolute returns through a leveraged long/short market neutral strategy.
The company said it is not aware of any comparable products to the BMO Global Equity Market Neutral Fund on the market.
BMO Global Asset Management head of client management for EMEA Mandy said retail and institutional investors alike are looking for “innovative solutions for challenging markets”.
Mannix said the fund would deliver an “ideal building block” for multi-asset portfolios due as it was liquid, highly diversified and had low correlation to major asset classes.